Pentagon surprisingly slow to adopt RFID
RFID technology was supposed to help the Pentagon cope with its massive supply and logistics operations; bucking the trend in other sectors, the Pentago is yet to warm up to the technology
Wal-Mart and the Pentagon were among the first to ruqire their suppliers — and both organizations have many suppliers — to tag their supplies with radio frequency identification (RFID) tags for better monitoring of the supply chain. It now appears that DoD’s RFID requirment is encountering resistance within the department itself, indicating that the effort may need time for the technology to mature. Government Executive’s Bob Berwin reports that demand in the Pentago for RFID readers and tags from a contract known as Army Product Manager Joint-Automatic Identification Technology (PM J-AIT) has been so weak that the Army does not plan to award new contracts until the first quarter of fiscal 2008, which starts in October. The initial PMJ-AIT contract, awarded in September 2005, expired in June, and Jo Manson, PM J-AIT spokeswoman, told Berwin that demand “was low due to delays in full-scale passive RFID implementation across DoD.”
Passive RFID tags have no internal power supply. The minute electrical current induced in the antenna by the incoming radio frequency signal from the RFID reader provides just enough power for the CMOS integrated circuit in the tag to power up and transmit a response. Active RFID tags have their own internal power source, which is used to power the integrated circuits and broadcast the signal to the reader.
RFID vendors agree with Manson, saying that demand for readers and tags has been nearly nonexistent. Roger Perron, president of Petersburg, Michigan-based SYS-TEC, said business had been “poorer than poor … . I’ve had three orders and sold 10 readers or less. RFID is not the next great thing.”
There are advantages to using RFID technology, as the Army can quickly determine what supplies are on what pallets without the need to open every case and repackage the cases for shipment to appropriate destinations. Perron admits, however, that there are fundamental problems with the technology. For example, the technology is supposed to make it easy to read tags on cases stacked in the middle of a pallet, but Perron said RFID users have found it difficult to penetrate to cases buried in the middle of a pallet. Liquids also pose a problem, Perron said, because cases or pallets containing them absorb energy from RFID readers, making it difficult to receive a reply.
Objects containing metals also present a problem, because metal reflects the signal from the RFID reader before it can read the tag, Perron said. SYS-TEC is working on a project with the Air Force to use RFID tags on computers for inventory control purposes, and the company had to add a shield to its tags to produce a good signal, Perron said.
There are two views and what are the business implications of the Pentagon’s slow response to RFID. Greg Buzek, president of Franklin, Tennessee-basedIHL Consulting Group, said the promise of RFID “has been hyped beyond its practical uses right now” and that the problems reading tags attached to metal or liquid shipments illustrate the downside of the technology.
The always insightful technology maven Craig Mathias of Massachusetts-based FarPoint Group (Web site under construction) agrees that passive RFID has its limitations in some cases and that some users such as Defense may have to use active tags to track some commodities. Still, Mathias wonders whether the low sales experienced by SYS-TEC are an anomaly, as “hundreds of millions of tags are being sold by major vendors.” He has a point: Cambridge, U.K.-based market research firm IDTechEx forecast sales of 1.71 billion RFID tags this year across all sectors, from supply chain to retail to public transport to national ID cards. The firm said the total value of the RFID market would reach $5 billion in 2007. The company predicted that the market would reach $28 billion by 2017. This is why SYS-TEC’s Perron, despite his experience, is optimistic about RFID, saying Defense “might get off the dime in 2008.”